Japan, which after the Fukushima nuclear disaster in 2011 became world’s second largest importer of fossil fuels, is likely to increase its LNG imports from Australia and North America at the expense of current suppliers – Nikkei Asian Review reported yesterday.
Currently, Japan is the world’s largest LNG importer, with LNG meeting 95 per cent of the country’s gas demand. So far, a large portion of the gas has come from South-East Asia, but this is likely to change, with Malaysia and Indonesia expected to consume more of their own LNG.
According to the data released by The Japanese Ministry of Economy, Trade and Industry, Australia will remain the main source of LNG, with the share of the imports increasing to 40 form 20 per cent last year. This increased reliance on Australia will come as Japanese power companies start buying LNG from a large gas field being chiefly developed by Inpex, a Japanese oil and natural resources developer.
Another source of LNG imports will be North America, with imports form the U.S. expected to start in 2016. The Ministry expects the total amount of imports from the U.S. and Canada to account for 70 per cent of Japan’s total LNG purchases.
The big losers when it comes to trading LNG with Japan will be the Middle Eastern countries like Qatar, United Arab Emirates, and Oman – in 2012 accounting for 18, 6, and 5 per cent of imports respectively. By 2020 the total share of imports from the Middle East is set to shrink from 30 to 20 per cent.
Australia and North America have won the LNG contest by offering political stability and competitive pricing. U.S. gas, when it becomes available, is expected to cost 20 per cent less than what Japan is currently paying.
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